Under efforts to increase margins, Shanghai Everskill M&E Co. Ltd has launched a super-thin seamless aluminum tube seen to replace costly copper variants. This comes amid the company's plans of increasing prices in the next six months because of escalating production outlay.

In an interview with Global Sources, general manager Jason Lee discusses the company's advantages over other competitors. Below are excerpts of the discussion.

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<b>What new products will your company launch in the next six months?</b>

We will focus on high-tolerance models to boost product value.

We launched a super-thin seamless aluminum tube that comes with thinner walls to bring down costs and improve margins. Strength and heat conduction properties are close to copper tubes, making it a viable replacement for the latter.

Some clients are switching to aluminum because of increasing copper costs.

Aside from this, we are also working on high strength aluminum alloy and developing new alloys as well to meet various market requirements.

<b>How is your company dealing with rising production outlay?</b>

Raw materials, labor and energy costs contribute to rising outlay. Since no one has control of this issue, we take proactive efforts by hiring highly productive employees, finding stable suppliers and increasing productivity.

To reduce energy usage, we are recycling waste materials and changing work schedules.

Moreover, higher commissions are given to encourage sales personnels in getting valuable clients by sharing the project profit instead of a fixed sale percentage.

We will also increase our prices in the next six months because of the rapid change in raw materials cost.

In 2010, for example, we sent a quotation to a client after every detail has been clarified via telephone and e-mail. We earned the client's trust as we promised a reasonable lead time. A sales representative was then sent to personally discuss the details with the client.

Materials-wise, our sourching channels consist of the top three aluminum plants, including China Aluminum Corp., which can guarantee the quality of our final products.

Our company's QC measures require a thorough examination of a product, service or process to ensure they meet our specified standards. If a problem is identified, the QC team may temporarily halt production.

In terms of R&D, we partner with several universities to get more information about industry trends. Our clients also take part in product research and development.

According to the market demand and technologies of our partner, Dana Inc., our company developed a unique manufacturing process.

When it comes to our production capacity, we can roll out about 50,000 metric tons of aluminum products per year.

Besides these, a training organization ensures we meet our targets. Top-management level employees report their training schedules for the year, all of which will be under the company expenditures.

We think that South America has the largest potential for China suppliers.

In contrast to developed markets, many South American countries are fighting off inflation pressures, giving way to above-potential growth in 2011 and coming years.

Growth in the area is driven by high government spending, which will gain momentum next year once domestic demand follows suit.

<b>What is the outlook on sales and exports for the next six to 12 months? What opportunities or challenges are expected to boost or limit growth?</b>

While less than stellar, the US' recovery looks robust compared with other developed markets. In the case of Japan, although its exports in the early months of 2011 lifted its economy, overall growth this year will be weak.

Next year, the economy will be anemic as a higher yen weighs on the trade sector and the unfavorable demographics reduce domestic demand.

In Western Europe, growth will be barely seen as the area struggles to control ballooning deficits in Greece.

Any potential for growth will be limited by the challenging credit environment, while the banking sector remains a key risk to the outlook.

Rising raw material costs and lack of manpower will also add to the challenge for manufacturers and exporters.

<b>Do you think the global economy has recovered?</b>

We are optimistic that the global economy will grow in 2011 and the coming years. The momentum will be strong, driven by South America, Africa and Asia.

But we also have to deal with significant challenges ahead. This include inflation, the turmoil in North Africa and the Middle East, as well as the crisis in Europe, which will linger for a while.

In addition, we think there will be more volatility and uncertainty going forward because of these issues, which impact people's behavior. These, of course, also affect the global economy.

<b>What does your company think of young factory workers?</b>

Older workers are more experienced. They work hard and have bigger responsibilities. Young employees, meanwhile, are equipped with skills in new technologies and are also fast learners.

The majority of its products are used in the aviation, aerospace, communication, transportation, packaging, construction, home appliance and printing industries. BMW and Hubbell are some of the company's major clients.

Products comply with ASTM and BSEN standards.

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